19th Nov 2007 07:45
SABMiller PLC19 November 2007 KONINKLIJKE GROLSCH N.V. SUPPORTS SABMILLER PLC'S INTENDED PUBLIC OFFER OF €48.25 PER SHARE FOR ALL THE ISSUED SHARES This is a joint press release by SABMiller plc ("SABMiller") and KoninklijkeGrolsch N.V. ("Grolsch") pursuant to the provisions of Section 5 paragraph 1 andsection 7 paragraph 4 of the Dutch Decree on Public Takeover Bids (Besluitopenbare biedingen Wft). This announcement is not for release, publication ordistribution, in whole or in part, in or into the United States, Canada,Australia, Japan or Italy. This announcement and related materials do notconstitute an offer for (depository receipts or) shares in Grolsch (the"Shares"), but constitute notice that a conditional agreement has been reachedbetween SABMiller and Grolsch on the terms of a recommended offer to be made bySABMiller. - SABMiller intends to make an offer of €48.25 per Share for 100% of theoutstanding Shares of Grolsch. This Offer represents an 84.3% premium toGrolsch's average closing share price over the last month and a totalconsideration of €816 million; - Grolsch is an iconic Dutch brand whose rich Northern European heritageand premium positioning will complement and further build SABMiller's existinginternational brand portfolio; - SABMiller sees significant additional potential for the Grolsch brandacross Africa and Latin America, where the premium segment is still in itsinfancy, and in the more developed markets of Central and Eastern Europe; - SABMiller anticipates that production volumes at the modern Enschedebrewery will increase following the transaction; - The Management and Supervisory Boards of Grolsch unanimously supportthe intended Offer although they did not seek a takeover approach; - An irrevocable undertaking has been entered into by Stichting NBC onbehalf of certain shareholders (the "Committed Shareholders") and SABMiller totender the Shares held by the Committed Shareholders, representing some 37% ofthe outstanding Shares; and - The acquisition will be marked by the establishment of an employee fundof €8 million. SABMiller (SAB.L) and Grolsch (GROL) today announced that they have reachedconditional agreement regarding the making, by SABMiller, of a fully financed,public cash offer to acquire all the outstanding Shares of Grolsch. The offerprice of €48.25 per Share of Grolsch (the "Offer"), represents a premium of84.3% to the average closing price of Grolsch's Shares over the last month. Nofurther dividends are expected to be declared prior to the completion of thisOffer. The Offer values 100% of the issued and outstanding Shares of Grolsch atapproximately €816 million. Grolsch is an iconic Dutch beer brand with almost 400 years of brewing heritageand a strong position in the Netherlands. It is positioned as a true Dutch beerbrewed to an original recipe which is now complemented by 21st centuryproduction processes and innovative packaging. In addition to Grolsch PremiumPilsner, which accounts for over 90% of its portfolio, Grolsch also has a numberof attractive brand variants including Grolsch Premium Weizen, Spring Bock andAutumn Bock as well as the Amsterdam brand. Grolsch's provenance, unique taste profile and existing premium positioning willplay a highly complementary role in SABMiller's international brand portfolioand better position SABMiller to grow market share in the fastest growingsegment of the global beer market. The SABMiller group has the scale and reachto grow the Grolsch brand internationally via its operations which span morethan 60 countries, across six continents. SABMiller's global footprint providesopportunities to take the Grolsch brand into new geographies, particularly indeveloping markets where, historically, quality Northern European brands haveoften established the premium segment. SABMiller sees significant potentialacross Africa and Latin America, where the premium segment is still in itsinfancy, and in the more developed markets of Central and Eastern Europe. SouthAfrica represents a key opportunity and with the addition of Grolsch, SABMillerwill have a particularly strong portfolio of highly differentiated premiumbrands in that market. No change to the existing distribution agreements for thebrand in the USA, UK, Canada, Australia and certain smaller markets isanticipated at this time. In 2004 Grolsch completed the construction of a state of the art c. 3.8 millionhectolitre brewery. This brewery has sufficient capacity to accommodatesignificant international growth of the Grolsch brand while also providing anopportunity for SABMiller to brew its own international brands for sale in theNetherlands and for export to key markets. Grolsch has a proven track record of innovation and operating excellence andthis is expected to provide reciprocal opportunities for the sharing of bestoperating practice between the two companies. By leveraging these opportunitiesand enhancing the prospects for Grolsch both in its home market, across Europeand around the world, the combination of Grolsch with SABMiller is expected tobenefit all of Grolsch's stakeholders. SABMiller has committed to guarantee theemployment terms and pension rights of Grolsch's employees and will seek toincrease production levels at the Enschede brewery. The Supervisory Board and Management Board of Grolsch unanimously support theintended Offer and, after taking into account the interests of all stakeholders,including Grolsch's shareholders and employees, will recommend that shareholdersaccept the Offer when made. The Offer is also fully supported by CommittedShareholders that hold over 37% of the issued and outstanding Shares of Grolsch.The Committed Shareholders have signed an irrevocable undertaking to tendertheir shares to SABMiller if the intended Offer is made. The irrevocablecontains certain customary undertakings and conditions including that theCommitted Shareholders will only tender their Shares to a third party offeror ata price of at least 7.5% above the Offer price. SABMiller will have the right tomatch any bona fide competing offer. Commenting on the transaction, Graham Mackay, Chief Executive of SABMiller,said: "Grolsch will provide SABMiller with a powerful addition to itsinternational brand portfolio. Within the SABMiller family Grolsch will continueto build on almost 400 years of brewing heritage, and together we will establishnew positions in the most important emerging beer markets around the world. Bothcompanies share a passion for the brewing tradition, and we are delighted to bepart of this new chapter in Grolsch's development." Commenting on the transaction, Ab Pasman, Chief Executive of Grolsch, said: "Inaddition to financial considerations it was important for us to give a lot ofattention to the interests of our employees, customers and our home region. Wewere doing a good job executing our independent strategy. When we were asked toconsider SABMiller's proposal the key question was if greater value could beachieved than through our own existing strategy. Since this appeared to be thecase we entered into discussions and we believe that SABMiller's intended Offerdelivers benefits to all of our stakeholders. We look forward to continuing tobuild our position as a premium brand within the new family." Employee fund Following the request of the Supervisory and Management Boards of Grolsch anemployee fund worth €8 million will be established to mark the plannedacquisition. Offer Process SABMiller and Grolsch expect to reach full agreement regarding the finalOffering Memorandum shortly. When made, the Offer will be subject to customaryconditions, including an acceptance threshold of at least 75% per cent of theoutstanding Shares of Grolsch. SABMiller requires permission of the Managementand Supervisory Boards of Grolsch in order to declare the public offerunconditional in the situation that less than 66.7% of the outstanding Shareshave been tendered, committed and acquired. In the event that the Offer isdeclared unconditional and less than 95% of the total share capital is acquired,SABMiller intends to utilize available legal measures (for example a legalmerger and squeeze out) in order to increase their ownership to 100% of thetotal share capital. The offer will not be subject to regulatory clearances. The Offering Memorandum is expected to be published in early January 2008.Following the publication of the Offering Memorandum, Grolsch will convene anextraordinary general meeting of shareholders to inform its shareholders aboutthe Offer and to approve certain customary resolutions that are to be adopted asa condition to the Offer. The Netherlands Authority for the Financial Markets (Autoriteit FinancieleMarkten) and the Social-Economic Council (Sociaal Economische Raad), and therelevant anti-trust authorities have been or will be informed. The relevanttrade unions will be duly notified. The works council of Grolsch will berequested for advice. Advisers ABN AMRO Bank is acting as financial adviser to SABMiller. Stibbe together withLovells (London) are acting as legal advisers to SABMiller. Fortis is acting as financial adviser to Grolsch. De Brauw Blackstone Westbroekis acting as legal adviser to Grolsch. Overview of SABMiller SABMiller plc is one of the world's largest brewers with brewing interests ordistribution agreements in over 60 countries across six continents. The group'sbrands include premium international beers such as Miller Genuine Draft, PeroniNastro Azzurro and Pilsner Urquell, as well as an exceptional range of marketleading local brands. Outside the USA, SABMiller plc is also one of the largestbottlers of Coca-Cola products in the world. In the year ended 31 March 2007,the group reported $3,154 million adjusted pre-tax profit and revenue of $18,620million. SABMiller plc is listed on the London and Johannesburg stock exchanges. For more information on SABMiller plc, visit the company's website:www.sabmiller.com. Overview of Grolsch Grolsch is a listed company with a rich tradition that goes back to 1615. Thefocal point of Grolsch's commercial activities lie in the Netherlands, Grolsch'shistoric home market. However, important international markets for Grolschinclude the United Kingdom, the United States of America, Canada, France,Australia and New Zealand. Grolsch is focused on targeting the premium segmentwith the Grolsch brand as its main product. In the year to 31 December, 2006, Grolsch reported turnover of €317.6 millionand net profit of €19.2 million. Total worldwide sales volumes were 3.2 millionhectoliters (hls), comprising 1.6 million hls of domestic volumes in theNetherlands, and 1.6 million of international volumes. Grolsch has approximatelya 15% market share in the Netherlands, where it operates from one brewery inEnschede. Its main domestic brands include Grolsch Premium Pilsner, whichrepresents approximately 90% of total volumes in the Netherlands. Grolschachieves approximately 80% of its international sales volumes in the UK, theUnited States, Canada, France, Australia and New Zealand through a network ofalliances. For more information on Grolsch N.V., visit the company's website:www.grolsch.com. This announcement is for information only and does not constitute an offer or aninvitation to acquire or dispose of any securities or investment advice or aninducement to enter into investment activity. This announcement does notconstitute an offer to sell or issue or the solicitation of an offer to buy oracquire the securities of SABMiller or Grolsch (the "Companies") in anyjurisdiction. The distribution of this announcement may be restricted by law. Persons intowhose possession this announcement comes are required by the Companies to informthemselves about and to observe any such restrictions. Forward-Looking Statements This press release includes "forward-looking statements" and language indicatingtrends, such as "anticipated" and "expected" Although the Companies believethat the assumptions upon which their respective financial information andtheir respective forward-looking statements are based are reasonable, they cangive no assurance that these assumptions will prove to be correct. Importantfactors that could cause actual results to differ materially from the Companies'projections and expectations are disclosed in Grolsch's annual report for theyear ended 31 December 2006 and in other documents which are available onGrolsch's website at www.grolsch.com and in SABMiller's annual report andaccounts for the year ended 31 March 2007 and in other documents which areavailable on SABMiller's website at www.SABMiller.com. These factors include,among others, changes in consumer preferences and product trends; pricediscounting by major competitors; failure to realize anticipated results fromsynergy initiatives; failure to obtain regulatory consents or other third partyapprovals; and increases in costs generally. All forward-looking statements inthis press release are expressly qualified by such cautionary statements and byreference to the underlying assumptions. Neither SABMiller nor Grolschundertakes to update forward-looking statements relating to their respectivebusinesses, whether as a result of new information, future events or otherwise.Neither SABMiller nor Grolsch accepts any responsibility for any financialinformation contained in this press release relating to the business oroperations or results or financial condition of the other or their respectivegroups. Enquiries:---------------- ---------------------- -------------- SABMiller plc Tel: +44 20 7659 0100 Sue Clark Director of Corporate Affairs Mob: +44 7850 285471 Gary Leibowitz Senior Vice President, Investor Relations Mob: +44 7717 428540 Nigel Fairbrass Head of Media Relations Mob: +44 7799 894265 Fiona Antcliffe Brunswick Group LLP Tel: +44 20 7404 5959 Koninklijke Grolsch N.V. Tel: +31-53-48 33 176 Erna van der Neut-ter Balkt Head of Corporate Communications Tel: +31-53-48 33 176 This announcement and a video interview with SABMiller management are available on the SABMiller plc website at www.sabmiller.com. ------------------------------------- High resolution images are available for the media to view and download free of charge from www.newscast.co.uk.----------------------------------------------------------------------------------------------- This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
SAB.L